CBRE Global Investment Partners and Madison International Realty announced the acquisition of a 6,458-unit portfolio of Spanish residential properties valued at nearly $1 billion.

The portfolio has been purchased as part of the recapitalization of a fund managed by Azora, which had come to the end of its life. Azora, a specialized investment and asset manager, will continue to manage the assets and has a minority stake in the venture.

CBRE GIP and Madison intend to grow the venture and seek further opportunities to invest in the Spanish multi-family housing market.

The portfolio comprises 65 primarily mid-market apartment block buildings of which approximately 70 perceent are located in and around Madrid, with the balance in other key cities.

With a strong economic backdrop and significant tailwinds, as well as an undersupplied housing market in Spain’s major cities, CBRE GIP and Madison believe the Spanish multi-family housing market remains a compelling investment opportunity.

Alexander van Riel, Head of Continental Europe at CBRE Global Investment Partners, said: “The residential rental market is Spain is very fragmented making this portfolio and its critical size unique to act as a major consolidator in the sector. This investment is in line with our key strategy – to focus on urbanization and demographic trends in supply constrained markets – and increases the CBRE GIP residential sector exposure in Europe.”

Derek Jacobson, Co-Chief Investment Officer at Madison International Realty, commented: “This investment represents a rare opportunity to acquire a large scale, high quality residential portfolio located largely in the Spanish capital. We have a track record of residential investment and management in the US from which to draw on as we look to grow this joint venture. This is our first JV with both CBRE GIP and Azora and is typical of the strong focus we place on building strong relationships with specialist partner firms where we can combine their expertise and local market access with our own real estate discipline and approach.”

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